Release Date: August 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Standalone revenue grew by 58% year-on-year to INR731.9 crore.
- Consolidated revenue increased by 53% year-on-year to INR748.7 crore.
- Standalone PAT saw a significant growth of 103% year-on-year.
- The company has a healthy unexecuted order book of approximately INR4,000 crore.
- Man Industries (India) Ltd (BOM:513269, Financial) is expanding with a new plant in Dammam, Saudi Arabia, costing approximately INR600 crore.
Negative Points
- There was a clerical error in the projected ERW capacity, leading to confusion.
- The ERW segment faced initial yield issues, impacting EBITDA.
- Majority of the orders executed were domestic, which typically have lower margins compared to exports.
- The company is currently operating at only 60% capacity utilization in India.
- The ERW segment is expected to operate at only 40% utilization this year due to teething issues.
Q & A Highlights
Highlights from Man Industries (India) Ltd (BOM:513269) Q1 FY25 Earnings Call
Q: Could you explain the reduction in projected ERW capacity by FY26 from 275,000 tonnes to 225,000 tonnes?
A: There might be a clerical error in the presentation. We will get back to you on that.
Q: What is the expected capacity and revenue from the new Saudi Arabia plant?
A: The plant will have an approximate capacity of 400,000 tonnes and is expected to generate a top line of INR3,000 crore to INR4,000 crore.
Q: Can you provide a breakdown of the current order book between domestic and exports, and the segments?
A: Around 80% of the order book is for exports and 20% is domestic. For the segments, 80% is for oil and gas, and 20% is for water.
Q: What are the margin and revenue projections for FY25?
A: The EBITDA margin is projected to be around 10%, with a top-line growth of approximately 20% from last year.
Q: What is the rationale behind setting up the new plant in Saudi Arabia?
A: The plant will help us capture the large transmission projects in Saudi Arabia, which we are currently missing out on due to high shipping costs and duties.
Q: What is the expected utilization rate for the Saudi facility and the Indian facility for line pipes?
A: The Saudi facility is expected to have a utilization rate of 70% to 80%, while the Indian facility is currently at 60% and is expected to maintain that level.
Q: What is the expected revenue from the stainless steel CapEx and its margin profile?
A: The stainless steel CapEx is expected to generate peak revenue between INR900 crore and INR1,100 crore, with an EBITDA margin of 18% to 22%.
Q: What is the expected order inflow for this financial year?
A: We have a lot of bids in the pipeline, with a normal strike rate of 20% to 25%. The bid book is currently valued between INR8,000 crore to INR10,000 crore.
Q: What is the expected revenue from the ERW segment this year and next year?
A: This year, we expect around INR250 crore to INR300 crore from ERW. Next year, we expect total revenue from ERW to be between INR500 crore to INR600 crore.
Q: What is the expected utilization rate for the ERW facility this year?
A: We are looking at a utilization rate of around 40% this year, with an expectation to reach 60% to 70% next year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
